Grant-in-Aid Funding(B)

Towards Paradigm Shift on Asian Agricultural Finance Research: Regional Comparative Study Focusing on Differences in Rural Social Structure

Principal Investigator: FUJITA, Koichi
Period: FY2012-15

This research aims at conducting a regional comparative analysis on performance of agricultural/rural institutional finance in major parts of Asia. It consists of historical research of agricultural finance in Japan, Okinawa, Korea and Taiwan, and its contemporary analysis in China, Vietnam, Laos, Thailand, Indonesia, Myanmar, Bangladesh and India.
The major hypothesis is that the performance of the agricultural cooperatives in each region had a close relation with the structural characteristic of rural society which had been formed historically in a long period of time. In East Asia, in the pre-War period, we analyze why the agricultural cooperative finance had been successful in various degrees, by connecting it with the difference/similarity of rural social structure within the region. In Southeast and South Asia, in contrast, we analyze and criticize the current status of a quite high interest rate at around 3 per cent per month in rural finance under the situations in which financial liberalization had been carried out since the 1980s and microfinance had flourished in a wider scale. The ultimate purpose of the present research is to criticize the current paradigm on agricultural/rural institutional finance which allows the high interest rate structure and thereby try to facilitate the paradigm shift in institutional credit supply in rural areas in developing countries.